The row began over the weekend when shadow chancellor Ed Balls said a future Labour government would retain the coalition's pay squeeze on public sector workers.

Unite general secretary Len McClusky issued a highly combative response yesterday, while other union leaders threatened to cut their ties with the party.

"According to Len, by trying to position Labour as a credible alternative to the coalition, Ed Miliband has set it on a path to 'destruction'," Mr Johnson wrote in the Guardian.

"Stuck in a familiar groove, Len goes on to suggest that all the ills that he claims are befalling Labour are because of actions of so called 'Blairites' – those terrible people who introduced the minimum wage and increased the number, the stature and indeed the pay of public sector workers across the country."

Mr Miliband has traditionally sought to avoid the confrontations with unions which characterised the time of Tony Blair and Gordon Brown, but there are some very concrete political advantages to a public spat with union leaders and many voices in his office are urging him to make the most of it.

The fight shows voters the party is serious about taking a disciplined approach to reducing the deficit and also distances Miliband from the unions which helped him win power in the first place, leading some newspapers to give him the moniker 'Red Ed'.

But if the relationship becomes too fraught, the unions could remove their funding arrangement, depriving Labour of up to 80% of its income.

While many analysts point to Mr Blair's ability to retain union backing despite their conflicts, this does not account for the aura of success the former prime minister had around him – a factor which could not currently be said to apply to Mr Miliband.

"Ed has stated a simple fact; that a Labour government will not be able to reverse as many of the cuts the current government is making unless it can show where the money is to come from," Mr Johnson continued.

"The difference between Len's position and Ed's is that Len believes a political party can win an election on a platform of promising no cuts, no job losses and continued levels of public expenditure. That is the policy of the delusional left who will never again win the public's trust."

He added: "The trade union movement lost its way in the late 1970s when it opposed the minimum wage and supported the closed shop. It needs to recognise that Ed Miliband's vision of a better future requires a change of mindset throughout the party if we're to spend one term in opposition rather than a decade."

Mr Johnson has made few forays into frontline politics since he quit as shadow chancellor last January, following an affair between his wife and the family bodyguard.

As a key Blairite and former union leader, his contribution to the row will be interpreted as a sign that centrist elements in the party feel Mr Miliband's leadership is moving in their preferred direction.

Meanwhile, backbench Labour MP John Mann attacked the policy shift, saying it left Labour with a "glaring" contradictory economic policy.

"The Eds will stimulate growth by cutting taxes – in their policy VAT at a budget deficit cost of £50 billion lost revenue each prliament," he told Labour-supporting website LabourList.

"So Labour ups the deficit in order to stimulate future growth. But simultaneously they will cut the deficit by freezing public sector pay at one per cent and thereby cut growth. Their position is entirely contradictory.

"Rationally to boost growth they should do exactly the opposite – keep public sector workers disposable income up and reduce the deficit by keeping the VAT increase, as the correlation on spending is much clearer with the former than the latter."